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Morning Briefing for pub, restaurant and food wervice operators

Wed 26th Nov 2014 - Propel Wednesday News Briefing

Story of the Day:

Greene King Leisure Spend Tracker – eating out outperformed leisure spend performance in October: British household leisure spending fell for the second consecutive month, the latest Greene King Leisure Spend Tracker reveals. Total leisure spend fell 10% during October, compared to the same month last year, to £188, as Britons held back spending in the lead-in to Christmas. This decline was driven by other leisure, the leisure category that includes live events, bowling and gym membership, which was down 22% year-on-year. All households across all regions have cut back on other leisure spending in an attempt to alleviate pressure on their finances. Eating out, on the other hand, was relatively stable as households appear reluctant to cut back on meals away from home. It was the only activity to see year-on-year growth, up £2 (2%). This was driven by family households and households outside of London and the south east, whose spending was up by 5% and 25% respectively. Steve Jebson, Greene King’s commercial director, said: “It has been another tough month for leisure spend, falling 10% compared to October last year. With Christmas just around the corner, Britons yet again limited their leisure spend last month. And, with consumer confidence still fragile, it is not surprising that many are hesitant to loosen the purse strings.” Commenting on regional total leisure spend, Jebson said: “We saw that households in London and the south east reduced their spend more than elsewhere – down 16% compared to 7% in the rest of Britain. This could be due to the recent slowdown in the London property market, which may have temporarily hit the confidence of households in the capital. But, London and the south east still remains the biggest spending region, with £214 spent on total leisure in October, over 21% more than the average for the rest of the country.” To gauge how consumers are feeling about their leisure spending in the lead-in to Christmas, Greene King asked whether they intend to spend more or less this festive season. The report reveals that more Britons plan to spend less on Christmas presents, and on eating and drinking out, compared to last year. Jebson said: “We found that 26% of Britons plan to spend less on Christmas gifts this year, against 17% who plan to spend more. This trend is also reflected in the amount expected to be spent on eating and drinking out with 27% intending to spend less and 15% who expect to spend more. However, there was greater balance in projected spend on food and drink in the home, with 21% planning to spend more versus 20% who intend to spend less.”
 

Industry News:

Wetherspoon founder – end of the beer tie is a campaigning failure: JD Wetherspoon founder Tim Martin has argued that the decision by parliament to vote for an effective end to the beer tie reflects a failure by the pub companies to campaign on a broad basis. He told yesterday’s Propel podcast: “I hope [the outcome] will be the realisation that the industry as a whole has to campaign better. I have been trying to campaign myself – along with Jacques Borel, Fuller's, St Austell, Heineken and a number of other organisations – for VAT and tax equality with supermarkets. Quite a few pub companies have not campaigned and say nothing - their view is that they know George Osborne or have an 'in' with David Cameron or the Conservative party. What’s happened with tenancies is the result of that approach. You don’t have to convince the Conservative Party that tax equality is right, you have to convince your customers, the public and politicians generally, and very few of the chief executives of the big pub companies has tried to do that, and that’s what has happened with tenanted pubs. They have tried to focus on an 'in' with the Conservative party, and more power to Greg Mulholland’s elbow, in a way. He has stuck at it and got a cross-party alliance backed broadly by the public and so the pub companies are stuffed.”
 
Lettuce Entertain You to open two sites on Chicago’s Navy Pier: The legendary Chicago restaurant company Lettuce Entertain You Enterprises, led by Rich Melman, is opening two restaurants in a new dining area planned for the city's Navy Pier part of an effort to draw more visitors to the lakefront attraction with improved dining and retail options. The company is to open Frankie's Pizza by the Slice and Big Bowl Chinese Express at Navy Pier, said Kevin Reynolds, a partner at the restaurant company. He said: “Almost every visitor [to Chicago] has Navy Pier on their checklist. As we've expanded into airports, now we're expanding into Navy Pier. We see the value of having our locations in all parts of the city, regardless of the venue.” Both Lettuce restaurants, the company's first ventures at the tourist destination, will open in a new 30,000-square-foot dining area accessible from the pier's south walkway, not far from the Ferris wheel, a pier spokesman said. The area, which has been empty for about a year, once was leased to tenants that ran small retail kiosks and carts.
 
US restaurants 'will have to list calories on menus' under new rules: Restaurants in the United States will have to list clear calorie information on menus, under new rules from the country's Food and Drug Administration (FDA). Only chains with 20 or more stores are covered, but the list includes takeaways, made-to-order sandwiches, muffins at a bakery or coffee shop, popcorn at a cinema and ice cream from an ice-cream parlour, as well as sit-down meals. Pizza restaurants can list calories by the slice but have to say how many slices in a pizza. They can also list a range of calories to take into account different toppings. The FDA said in a statement that establishments covered by the new rules must list "calorie information for standard menu items on menus and menu boards and a succinct statement about suggested daily caloric intake. Other nutrient information – total calories, calories from fat, total fat, saturated fat, trans fat, cholesterol, sodium, total carbohydrates, fibre, sugars, and protein – will have to be made available in writing on request." Studies have apparently shown mixed results on whether Americans actually change behaviour when they see the calorie counts on food.

Company News:

Tesco Family Dining Group to acquire 266 in-store cafes: Tesco Family Dining Group, which operates 25 Decks carveries and cafes within the company’s supermarkets, is taking over another 266 in-store cafes operated previously by third parties, the company’s annual accounts reported. A total of “around £9m” will be paid for the portfolio, with the takeover phased between 29 September and the end of this month. The annual accounts reported 22 new cafes and restaurants have been opened within Tesco supermarkets in the current financial year that started on 23 February 2014 – there were just three sites operated by the division at the start of the financial year. The company’s first 42 weeks to 23 February 2014 saw turnover of £900,000, but administrative expenses of £2,036,000 produced a loss of £1,559,310.

Giorgio Locatelli seeks Christmas pop-up, new home after blast closes Churchill hotel: The Michelin-starred chef Giorgio Locatelli has appointed twentyretail to find him a pop-up over Christmas and a permanent restaurant site after a basement explosion closed the Churchill Hyatt Regency hotel in Portman Square, central London, home to his restaurant Locanda Locatelli for 12 years. The gas explosion caused part of the 434-room hotel to collapse. Earlier this week it was said that  investigators had not been able to enter the kitchen area in the basement of the hotel because of the amount of structural damage caused by the explosion. Structural engineers were assessing the damage in the basement, where an internal wall or ceiling may have collapsed. The incident left 14 staff injured and forced 500 guests of the five-star hotel near Marble Arch on to the streets. Locanda Locatelli opened in Seymour Street in 2002 and was first awarded a Michelin star in 2003. Locatelli is now looking for pop-up premises to serve guests who have made Christmas bookings, having run a pop-up pizza restaurant with his wife Plaxy in Carousel, Blandford Street, Marylebone for three weeks in September. At the same time, with no news on when the Churchill hotel might reopen, he is seeking a new permanent restaurant site, with A3 planning permission, and extraction, covering 2,500 to 6,000 sq ft, somewhere in Central London.

Rare central West End property comes to market:
A rare opportunity to acquire a corner site over three floors in the heart of the West End of London has been bought to the market by the property agent Christie + Co. The site, which has been traded as part of the Crazy Bear Group, has been a members club for many years with a private bar and a specialist Thai restaurant. The property includes a basement, ground and first floor, and there are two flats on the upper floors that could also be available if required. Although currently closed, the site is to be left fully equipped and ready to trade by new owners. The main ground floor bar seats 30, with room for more standing. The basement area is split into a bar area seating 30 and a restaurant that seats 40-plus. Simon Chaplin, director and head of restaurants at Christie + Co, said: “The venue is very opulent and is perfectly situated between the hubs of Covent Garden and Shaftesbury Avenue to attract a variety of clientele.” Christie + Co is seeking £750,000 for the leasehold.
 
Whitbread debuts hub by Premier Inn, wins new premises licence in Edinburgh: Whitbread opened its first hub by Premier Inn in St Martin’s Lane, Central London last Friday. Meanwhile, Monday saw the Edinburgh licensing board grant a provisional premises licence for the second proposed hub in the city on Rose Street, adding to a previous grant within the Caltongate development. Solicitor John Gaunt appeared for Whitbread.
 
Douglas Jack – there are signs of improvement at M&B: Numis Securities' leisure analyst Douglas Jack has hailed “signs of improvement” in Mitchells & Butlers trading performance. He has an 'Add' recommendation on the shares with a 420p price target. Jack said: “Prior to reclassifying the pension element of the interest charge out of exceptional items, 2014 profit before tax fell 1% to £182m (we forecast £182m; consensus £184m) with LFL sales up 0.6% and ebit margins down 50bps. After the interest reclassification, PBT fell by 7% to £172m. We are holding our ebit forecasts, but the pension interest reclassification equates to a £16m PBT downgrade for 2015E and beyond. With a high quality estate and a double-digit free cash flow yield, M&B’s shares are undervalued, in our view. The catalyst for a re-rating is reliant on improving product range, service and amenity driving up LFL sales, margins and returns. There are early signs of this, with LFL sales up 2.4% during early 2015E.”

Mountain Range re-open flood-hit pub as it plans expansion to 15 sites: Mountain Range Restaurants, the Alpine dining experience chain based in Sussex chaired by Stephen May and led by Greg Mangham, has re-opened The Coney, its site in West Wickham. The Coney has been closed since February due to flooding which caused serious damage to the cellar. The site has undergone a £140,000 makeover, including the introduction of a new kitchen. Mangham said: “The re-opening of the Coney will be the first stage in our strategy to re-launch the concept with plans to refurbish our other three sites early in 2015.” He praised NatWest for its support “during a testing nine months”. The company’s aim is to grow to 15 sites within the next 18 months to two years either through individual or group acquisitions – and various funding avenues are being explored.

Marco Pierre White to open new franchised restaurant: The chef-entrepreneur Marco Pierre White will open a new restaurant under franchise at the Holiday Inn in Kenilworth, Warwickshire in March 2015. Marco’s New York Italian will have room for 114 diners and will serve pasta, steaks, seafood, burgers and handmade pizzas. The news of the restaurant’s opening comes after a deal between Black & White Franchising and the hotel’s owner, Khanna Enterprises (Kenilworth) Ltd, which will run the new restaurant under a franchise agreement. Work is now under way to convert the existing restaurant and bar areas. David Myskow, general manager at the hotel, said: “This announcement is great news and will strengthen the appeal of the hotel."

Byron and Ask Italian to replace Kro in Manchester: The closed-down Kro site in Piccadilly, Manchester is to be replaced by a new Byron burger joint and an Ask Italian restaurant. The unit formerly occupied by the Danish bar and restaurant in the building at One Piccadilly Gardens is to be divided into two to make room for the two chains. It will be Byron’s second branch in the city when it opens in March, with a venue already established on Deansgate and a third set to open at the Corn Exchange when that reopens next June after a £30m refurbishment. Byron's founder, Tom Byng, said: “Manchester has a well-established burger scene and we’ve been delighted by the response since we opened our first restaurant in the city on Deansgate in 2013. We see Piccadilly Gardens as another exciting opportunity and are really looking forward to be opening there.”

Burger & Lobster unveils opening date for Cardiff site, biggest yet: The restaurant chain Burger & Lobster has revealed its Cardiff venue will be its largest to date. The venue will throw open its doors on Friday, 12 December in The Hayes with room for more than 300 diners. It will be next door to steak restaurant Miller and Carter, where the old fish market once was between 1901and 1935.

Former professional footballer plans first restaurant:
A former professional footballer has unveiled plan for his first restaurant. He plans to transform the Blue Marlin in Dundee into a new restaurant and bar. Kevin Webster, a former professional footballer for Dundee FC, Montrose, Arbroath and Forfar, owns the City Quay premises through his Forfar-based company Vista Properties. It is hoped Porters, a "relaxed" theme restaurant, which takes its design cues from the city's harbour heritage, will open early next year. Webster said: "We're full of positivity for the restaurant and the area. There's a lot of activity there just now. It may have been in shadows for a few years, but the way that Dundee is expanding at the moment is encouraging. Other cities like Aberdeen have had their boom, but Dundee's just about to happen and we want to catch it at the right time."

Soho nightclub Madame Jojo's forced to close after baseball bat incident: A nightclub in Soho, Central London has closed down after its licence was revoked because its bouncers allegedly attacked a man with baseball bats. Madame Jojo's was forced to close temporarily in October after the attack involving its staff and workers from a neighbouring club, Escape. Its owners reportedly changed manager and bouncers in an attempt to save the business. But the club looks likely to shut down permanently after Westminster Council revoked its licence at a meeting on Thursday evening. In a statement, the organisers of one of its most popular nights, White Heat, described the decision to close Madame Jojo's as "gutting".

Pizza Hut produces 'Scottish language' menu for launch of new Glasgow branch: Pizza Hut's new Silverburn shopping centre restaurant has launched a slang menu, apparently created in collaboration with local Glaswegians, to celebrate its opening. The menu described the Margherita pizza as " Jist a plain wan – a proper mozzarella and tamata pizza”, the vegetarian pizza as "Pure Bilin’ wi’ nae meat. Green chillies, peppers, red onions, cherry tamatas”, and the "meat feast" pizza as “Yer pick a’ tamata or BBQ sauce plus aw yer meaty favourites pepperoni, ham, beef and chicken." Beer is "swally", and desserts, which include "Murdurr by chocolate", are “braw puddin”. Customers can take home a copy of the limited edition phonetic menu.

Elliotts appoints first managing director:
The leading industry marketing and public relations agency Elliotts has promoted James Hacon to the post of managing director with immediate effect. Hacon, previously director of marketing and insights at Elliotts, with a career that includes spells at Virgin Australia, IHG and The Gleneagles Hotel, will be responsible for driving the business through its next phase of growth. Since joining Elliotts in February this year, he has overseen projects with blue-chip clients such as Spirit Pub Company, Tragus, Sodexo and Brakes, as well as the pharmaceutical giant GlaxoSmithKline. Hacon will now work alongside the agency’s chief executive, Ann Elliott, to continue delivering the growth plan after a 42% year-on-year increase in turnover, as well as running a team which has recently expanded from 12 to 20 people. The promotion comes at a time when Elliotts has made three other significant hires, including the appointment of the former Domino’s Pizza PR Bernadette Ahmed as public relations director, the ex-Unilever, Ogilvy and BBDO Global account director Caroline Jameson as director of insights and Garron McCullough as studio manager. Ann Elliott said: “It’s been a monumental year of growth for Elliotts, both in terms of turnover and team growth. The time was right to bring in a managing director to work with me to take the agency forward, and I’m delighted that in James we have someone who is more than ready to step up to the plate.”
 
YO! Sushi set for first Northern Ireland opening in early December: Yo! Sushi is to open its first Northern Ireland opening in early December. The chain will open at Victoria Square in Belfast. The Antrim-based firm Marcon has been tasked with fitting out the brand’s 67-seater restaurant at the Ann Street entrance to the centre. Mark McElroy, director of Marcon, said: “We are delighted to have secured this contract with YO! Sushi. We have an excellent track record of performing strongly within the restaurant sector and we are really looking forward to delivering this exciting project to Belfast.”
 
Details revealed for Steak of the Art lease in Cardiff: The Bristol-based restaurant Steak of the Art is paying a rent of £55,000 a year on the 15-year lease it has taken on 3,150 sq ft ground floor unit in Helmont House, Churchill Way, in the centre of Cardiff, for its second outlet, it has been revealed. Helmont House is home to a 200-bed Premier Inn Hotel and eight floors of office accommodation. The 150-cover restaurant will have an art gallery selling "quality affordable art". Work to fit out the new venue has now started with plans to open in early 2015. Steve Bowen, founder of Steak of the Art, said: “The art will be on display in a gallery, which people can visit without going into the restaurant. People will be able to buy the art but we also expect to have some exciting exhibitions, displays and events.” The space was let by Savills, on behalf of Cordea Savills. Phil Walker, assistant portfolio manager at Cordea Savills, said: “We are delighted to have secured a letting to an interesting, expanding restaurant concept at Helmont House. Steak of the Art is a positive addition to the building which we hope will been seen as a benefit to current and prospective occupiers.” Steak of the Art was represented by Insight Retail Consulting.
 
Spirit’s Fayre & Square brand offers ten free family Christmas meals: Spirit Pub Company’s family pub restaurant brand Fayre & Square is offering ten free family Christmas meals to families who cannot spend Christmas together. Carol Rhead, senior brand manager for Fayre & Square, said: “Christmas is a time for being with the family, but many aren’t lucky enough to spend the festive season with their loved ones. That’s why we have enlisted the help of our generous Fayrie Godmother to offer a tasty serving of festive joy.” The ten winning families will be chosen by Fayre & Square to receive an extra-special family festive feast at their local Fayre & Square. Anyone wishing to enter the competition or nominate a family to enter can apply via Facebook or the website at www.fayre-square.com or www.facebook.com/FayreandSquare. The competition is open until Sunday 30 November.

Nightjar’s Rift Bar invents Yorkshire Pudburger:
The new Rift & Co bar in Harrogate, formerly a Revolution bar and now part of Inventive's Nightjar subsidiary, has announced its arrival with the invention of a new local dish – the Yorkshire Pudburger. The burger, sandwiched between two Yorkshire puddings instead of a split bun, was inspired by the doughnut burger trend. Bar manager Jeremy Ambrose said: “I have seen the doughnut burger on a menu in a Leeds restaurant and thought I wanted to try and do something different. The new menu will have a big burger selection, but we wanted something that really stands out on the menu.” So far Ambrose is the only person to have tried to the pudburger, which was created by chef Pete Simons. He said: “It is good, really! Everyone is very eager to try it. People want to try something different that they maybe wouldn’t have at home when they go out to eat.” Rift & Co is run by the Nightjar Bars division of the New Inventive Bar Company, which also runs the Revolution and Revolucion de Cuba chains. The Rift & Co in Harrogate has undergone a renovation since its change from the Revolution fascia, peeling back the plasterwork to reveal the original tiles of the Royal Baths which had been covered up for decades. Ambrose said: “A lot of bigger bars look to be modern, but we are going back to the old school, revealing the building’s history and going back to what makes it so special.”

Fuller's Inns ties in with Harlequins rugby club to give fans special offers: Fuller's Inns, run by the London brewer Fuller, Smith & Turner, has linked up with the West London-based Premiership rugby club Harlequins to organise events, offers and promotions exclusive to Harlequins members in pubs around the club's ground. Members will benefit from exclusive promotions in six Fuller’s pubs near the Harlequins ground at the Stoop in Twickenham, the Cabbage Patch, the Prince Blücher and the Turk’s Head in Twickenham, the Prince’s Head in Richmond, the Admiral Nelson in Whitton, and the Royal Oak in Isleworth, which include 15% discount off food and drink (excluding RFU event days and Harlequins home matchdays), children eating free from a bespoke children’s menu, preferential rates on function packages and the chance to win exclusive Fuller’s experiences. The special events series starts on 4 December at the Cabbage Patch with an "Evening with …" where Quins players will take questions from an audience limited to 70 Harlequins members and pub patrons. Jonathon Swaine, managing director of Fuller’s Inns, said: “I am a life-long fan of Harlequins, so it is a privilege for not only Fuller’s Inns but for myself to be associated with this iconic club. Fuller’s pubs have always had an affinity with rugby, with it often being a key reason for our customers to come to our pubs."

Chelmsford to get first micro-pub:
The first micro-pub in Chelmsford, Essex is due to open in Moulsham Street next week, serving beer from some of the nearly 30 small brewers in Essex itself and the more than 50 in London, as well as from elsewhere. The owner of the new Hop Beer Shop, John Prior, 52, said: "It's in a shop, it's small, there's no music or spirits, it's all beer. It's just me – everything you see in there, even down to the furniture, I have built myself. I am taking it a bit further and making a craft beer shop, so we will have beers from London, Essex, Europe and the US. The idea is to listen to people, so if they want a certain beer, I can get it in. I'm also looking at doing a meet-the-brewer event, so people can come and talk to the brewer who made the beer they like. I have worked in the pub trade before, so I really got the idea from that and from talking to people about it. Looking at Essex, you have 29 micro-breweries here, so there is so much good beer flying around Chelmsford, and there is some great stuff coming out of London from their brewers." There are now more than 75 micropubs around the country, with 40 having opened this year alone.

Loungers lines up Cirencester opening: More details have emerged of plans by the cafe bar brand Loungers to open a branch in Cirencester town centre. It would be called Toro Lounge and take over the empty former Milletts store in Cricklade Street. It would be open from 8am to midnight Monday to Saturday, closing half an hour earlier on Sunday. The chain has applied to Cotswold Council for permission to transform the empty shop, with a date for a decision not yet set.

Pizza Hut franchisee RU Hungry takes on 21 jobless with opening of fifth site: The north east of England-based Pizza Hut franchisee RU Hungry has taken on 21 previously unemployed workers with the opening of its fifth site, in Hartlepool. Hartlepool businessman Jon Whitfield’s company Euro Property Management developed the site, formerly the Shakespeare pub, in Catcote Road, and created the unit at a cost of about £800,000, which was followed by Pizza Hut and RU Hungry ploughing a further £180,000 into kitting out the unit. The takeaway’s 25-strong team includes 21 from Hartlepool, who were all previously unemployed. Whitfield said: “We are often criticised for taking old pubs out, but when you look back at the Shakespeare, for example, it probably employed three or four people by the end. Now with Pizza Hut and One Stop and others along there, there’s about 60-plus staff there. It’s great news for the staff and the community.” A spokeswoman for Pizza Hut and RU Hungry said: “The support from the area has been fantastic. The new Pizza Hut Delivery team would like to thank the residents and businesses with some special offers in store.” RU Hungry's other sites are in Stockton, Middlesbrough, South Shields and Sunderland.

Las Iguanas confirms third Welsh site:
The Latin American restaurant group Las Iguanas will launch its third Welsh restaurant and bar, in Swansea, in March 2015. It covers 5,000 sq f., with a large, sunny piazza area, and is next to Swansea Castle. The restaurant will be part of the Castle Square redevelopment on Castle Lane, between The Strand and the castle, at the top of Wind Street.
 
Domino’s launches campaign for new dessert addition:
Domino’s Pizza UK has extended its dessert range with the launch of Domino’s Doughnuts. For the first time the launch of the new Domino’s dessert range will be supported by a standalone campaign, targeting an audience of "family feasters". Iris, the global creative innovation network, has developed a film that swaps Domino’s signature delivery scooters for another fairground favourite – a dodgem.
 
Westmorland buys Scottish family-run motorway services: Westmorland, the operator of Tebay Services on the M6, has acquired the family-run Cairn Lodge motorway services site in Scotland. The site is 35 miles south of Glasgow and serves both sides of the M74. Sarah Dunning, chief executive of Westmorland, said: "Cairn Lodge is a business that has built a loyal following over the years. It has a strong location, with customers who we believe will love the products that Westmorland offers. We are very much looking forward to working with the present owners and all the staff, and to putting our own stamp on Cairn Lodge over the coming months. This is an exciting next step in our growth, taking our total number of people employed by Westmorland to 850." Donna Hood from Cairn Services said: "We're really pleased to have found such a forward-thinking buyer for our family-run motorway services, I’m certain that Westmorland will continue to expand and improve on the 21 years of success we've made of Cairn Lodge Services." The Dunning family opened Tebay Services in 1972. Westmorland opened its second services between junctions 11a and 12 of the M5 on the outskirts of Gloucester in May, and the second stage of its £40m development of Gloucester Services is to open next June. The company specialises in focusing on local food and local suppliers.
 
Bain Capital set for 'substantial shortfall' after collapse of West Cornwall Pasty Company: A subsidiary of the US private equity firm Bain Capital is expected to suffer a "substantial shortfall" on its lending to West Cornwall Pasty Co after the firm was forced into administration earlier this year. Bain's subsidiary Sankaty, a secured creditor, was owed £5m when Price Waterhouse Coopers was appointed as administrator of the pasty company in April. This has been offset by £286,000 held in a blocked deposit account for the benefit of Sankaty. A progress report by PWC says that trade unsecured creditors are only expected to see a maximum of 2% of the £2.8m they are owed. The investment firm Enact emerged as the preferred bidder in the run-up to the administration, eventually buying 35 of West Cornwall's 65 outlets for £135,000. Sankaty took an equity stake in the company set up for the transaction. Enact has since collected just more than £115,000 in book debts, with no more expected. The blame for West Cornwall's collapse was laid on the government's controversial "pasty tax" and unfavourable weather conditions.
 
Zenith appoints high profile non-executive director: Zenith Hygiene Systems has appointed the former managing director of Hobart, Ian Garner, as a non-executive director. Zenith's chief executive, Ringo Francis, said: “Now is a very exciting time for Zenith. With four consecutive years of growth and a strategy to continually improve the products and services that are supplied to the growing customer base, Ian Garner’s professionalism, experience and wealth of industry knowledge will be integral in our on-going development.” Garner joins Zenith after serving 40 years with Hobart UK, where he joined as a food processing specialist in 1975. He spent many years in the national accounts team before he was appointed t director of sales in 1994, director of sales and marketing in 1997 and then managing director of the UK operation in 1999. “After spending 40 years within the hospitality and catering industry, my passion and enthusiasm has not disappeared,” Garner said.

US burger chains hit by soaring prices for beef: Burger chains in the United States have been hit by soaring prices, with the cost of lean ground beef up by 26% over the past two years, and predictions that it could rise as much as another 10% in 2015. As well as unfavourable weather dating back to 2010, with the onset of a severe drought in Texas and Oklahoma, which made it difficult for ranchers to graze cattle, prices have been pushed up by increased demand in China, which has passed the US as the world’s largest beef importer, Most cattle raised in the US is generally corn-fed and fat to promote marbling in steaks. That beef is frequently mixed with lean, 90% ground beef to achieve the 80% lean beef considered best for hamburgers. Much of that lean beef came from dairy cows, but some came from Australia. Now China is purchasing a lot of Australian beef that the US used to import in part to make burgers. The proliferation of better-burger concepts such as Five Guys Burgers and Fries, Smashburger, Habit Burger and Shake Shack has also increased demand for ground beef.

Mitchells & Butlers results – special report:

M&B sets out two-year targets: Mitchells & Butlers' chief executive, Alastair Darby, has set out a target to grow sales derived from three key “more attractive” market segments to 70% of all sales by 2016 – the three segments accounted for 57% of sales in 2010. The three growth segments are Upmarket Social (Nicholson’s, All Bar One, Castle and Alex), Special Occasions (Vintage Inns, Browns and Miller & Carter) and Family (Toby Carvery and Harvester). Darby said market analysis had shown that four brands within the growth segments, All Bar One (currently at 50 sites), Harvester (currently at 213 sites,) Miller & Carter (35 sites) and Toby Carvery (158 sites), had the market opportunity to grow to 1,200 sites from the current combined 455 sites. Darby said there were no guarantees that the four brands would grow to 1,200 sites but the market analysis showed the brands’ potential. He reported that the company's two other less attractive market segments, Heartland (Crown Carveries, Oaktree and Sizzling Pubs) and Everyday Social (Ember Inns), are expected to see contribution to overall sales reduce to 30% of sales in 2016 from 43% in 2010. Darby said the business should be judged on five criteria over the next two years as it attempts to complete the progress from "good to great" set in motion by chairman Bob Ivell in November 2011: whether M&B is able to achieve like-for-like sale growth ahead of the market; can maintain robust margins; make attractive investment returns; can reduce its net debt to ebitda and can reinstate the dividend. “Reinstatement of the dividend will be a critical moment," Darby said.
 
New consumer mindset: Darby said strategy at M&B will be guided by the new consumer mindset that has been created by austerity conditions in recent years. He said: “There is a need to deliver great value guest experiences – there has been a permanent change in consumer behaviour. People want more for no more.” Darby also argued that consumers are saying goodbye to formal meal-times and there is a need to provide flexibility by extending offers to include all-day eating and drinking occasions. Finally, Darby said, consumers felt a new need for reliable brands. He cited the example of Aldi now offering cut-price premium wine as the response to consumer demand that is required: “Aldi is a great-value retailer.”
 
The growth of breakfast: The growth of breakfast sales, due to hit 11 million a year by the end of this financial year, is an example of M&B extending its offer times to meet consumer demand, Darby said. Toby Carvery is now selling 60,000 breakfasts a week (three million a year) with an unlimited £3.99 offer seven days a week and Harvester, the company’s largest brand with 213 sites, is selling five million breakfasts a year.
 
Evolution of Toby Carvery, Harvester and All Bar One brands: Alistair Darby reported that M&B is evolving its brands and investing more in remodelling of existing sites. The company spent an average of £182,000 on 97 remodels last year, producing an average ebitda return of above 30%. This year saw an average of £202,000 invested on 174 remodels, also producing a return of more than 30%. Next year, he said, the number of remodels would increase to 200. Darby explained to analysts how Toby Carvery, Harvester and All Bar One were being evolved. Toby has the highest Net Promoter Scores in the estate and turnover, on average, of £28,000 per week per site. The brand image was being reinforced with a “Home of the Roast" tagline and a clear branding messages that reinforced the "homely" attractions of the roast. Harvester, meanwhile, has introduced a £9.99 meal deal, new menus with a stress on freshness, quality and value. A dozen sites had been remodelled with a more contemporary look that had been met “with huge enthusiasm”. This will be rolled out across the estate. All Bar One had seen a six points increase in its Net Promoter Score in the past year. The brand is now opening earlier, with a modern breakfast offer, including the unusual Boost Breakfast for £6.50, and had evolved its menu and offer with sharing plates, plus wine and cocktail masterclasses. Darby reported its new 02 arena site in Greenwich had taken £225,000 in a single week during a recent tennis tournament.
 
Freeing up managers to find their own solutions: Darby reported that the "good to great" programme, where managers were allowed to find their own solutions to problems, was producing results. He cited the example of a Vintage inns pub, the Calverley Arms, in Yorkshire, which had struggled to cope with demand on hot days as a destination venue. Darby reported that six members of staff had reported in sick at the start of one hot day, unwilling to face the stress of keeping up with demand. Its site manager had sat down with staff and come up with a series of commonsense solutions, including having the kitchen prepare packed lunches for staff to remove the extra pressure of providing staff meals during busy lunchtime sessions. He reported like-for-like sales growth at the site now stood at 14.8% and staff turnover is now 16 percentage points better.
 
Chairman Bob Ivell – it was frustrating not seeing the results coming through: Mitchells & Butlers' chairman, Bob Ivell, has described the most recent financial year at M&B as “frustrating”. He said: “There was lots of progress but results had not come through quite as quickly as we would have liked.” He said that delays progress translating into like-for-like sales growth, now evident in the first eight weeks of the current financial year, were linked to having 15 different brands. “It takes time to invest with 15 brands,” he said. Ivell acknowledged that M&B had faced having to catch-up with competitors that had “perhaps caught up with us”. With the consumer increasingly value-driven, M&B had spent the last year “getting back in shape as far as value is concerned”.

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